In the November 7, 2003 Issue:

Copyright State Science & Technology Institute 2003. Redistribution to all others interested in tech-based economic development is strongly encouraged — please cite the State Science & Technology Institute whenever portions are reproduced or redirected.

Subscription to the SSTI Weekly Digest is free. If you are reading a forwarded copy of this issue and would like to receive your own copy each week directly, please subscribe at http://www.ssti.org/Digest/digform.htm. Requests to unsubscribe also may be completed at http://www.ssti.org/Digest/digform.htm.


Ohio Voters Reject $500M Tech Bond Issue
By a narrow margin, Ohio voters on Tuesday rejected a constitutional amendment that would have permitted the state to issue up to $500 million in bonds over 10 years to fund technology-based economic development projects. Defeated 51 percent to 49 percent, Issue 1 would have made up the final component of Gov. Bob Taft's proposed 10-year, $1.6 billion Third Frontier project. The remaining $1.1 billion is unaffected by Tuesday's vote.

Bond proceeds could have been used for research and development purposes, new product development and commercialization, capital formation, operating costs, and support for public and private institutions of higher education, research organizations and private companies. It would have permitted direct investment in companies by state government.

In a state that has rejected only three bond issues in the last 26 years, Governor Taft speculated that the weak economy did the measure in. Political analysts cite other reasons why the measure was rejected, some of which may be helpful to others pursuing public votes for similar projects:

More information on the parts of the Third Frontier that will continue can be found at http://www.ohio3rdfrontier.org/ or under Ohio in the State and Local Story Index of the SSTI Weekly Digest at http://www.ssti.org/Digest/Indices/indexstate.htm

return to the top of this page

Think Tank Finds State Fiscal Crisis To Carry Into FY05
State budget woes will continue into fiscal year 2005, reports the Washington-based Center on Budget and Policy Priorities. According to the five-page A Brief Overview of State Fiscal Conditions and the Effects of Federal Policies on State Budgets, FY05 estimates released by 21 state budget offices project a combined total shortfall of up to $33 billion — or 9 percent of those states' expenditures. Moreover, the center points out the total does not include FY04 shortfalls that are already emerging in many states as revenues fail to meet projections when the FY04 budgets were approved.

While much media and political attention has been paid to the rising costs of some portions of state budgets, such as Medicare and education, the center reports that state revenues actually dropped by a total of $21.6 billion during FY03. Adjusting for inflation and population growth, state revenues for FY 2003 were $56.9 billion less than in FY01, the center finds.

Despite 29 states raising taxes in the past year to deal with the continuing deficit, the center asserts that "state taxes now make up a smaller share of the economy than at any time in the last thirty years, with the exception of the double-dip recession of the early 1980s."

California, Florida, Georgia, Illinois, New Jersey, New York, North Carolina and Virginia are singled out as facing the largest deficits going into the next fiscal year, which begins next July for most states.

A Brief Overview of State Fiscal Conditions and the Effects of Federal Policies on State Budgets is available at: http://www.cbpp.org/10-22-03sfp4.pdf

return to the top of this page

USDA, SBA Agreement Supports Rural Areas
To stimulate business development and job growth in rural areas, officials of the U.S. Department of Agriculture (USDA) and the U.S. Small Business Administration (SBA) signed on Oct. 31 a collaborative agreement to create the Rural Business Investment Program (RBIP). The initiative will allow newly formed venture capital investment companies to leverage private capital funds with government financial assistance and to obtain both government and private grant resources for technical assistance.

RBIP was created by the 2002 Farm Bill with funding through the Commodity Credit Corporation to support $280 million in guaranteed debentures and grants for technical assistance. Under the new agreement, USDA will enlist SBA's expertise in venture capital financing and reimburse SBA for carrying out the day-to-day management and operation of the program. Since 1958, SBA has operated the Small Business Investment Company (SBIC) program, a public-private partnership managing $17.7 billion in more than 10,000 firms across America.

Program officials expect to begin accepting RBIP applications in about six months. SBA has offered to give special consideration to rural applicants in its SBIC program until RBIP is fully operating. More information on program implementation will be published in the Federal Register and available through USDA at http://www.rurdev.usda.gov.

return to the top of this page

North Carolina Creates Rural Entrepreneurship Institute
Coupling manufacturing's sharp employment drop with the perennial struggles of a rural economy and the current economic downturn can cause massive struggles for many of the country's sparsely populated areas. The closure or significant downsizing of one manufacturing plant can be terminal for a small, rural town.

To revise that prognosis, North Carolina's Rural Economic Development Center launched the Institute for Rural Entrepreneurship in late October, along with several other new initiatives.

The institute will work with the N.C. Department of Commerce, N.C. Community College System and more than 30 economic and community development organizations statewide to put into place a 10-step business development strategy, including a $1.1 million initiative to help displaced manufacturing workers start their own businesses. The institute also will offer a range of grant and loan programs, education and training opportunities, and research and advocacy initiatives.

The first initiative to take effect will be the New Opportunities for Workers (NOW) program to provide dislocated workers in counties heavily impacted by manufacturing losses with opportunities to develop their own small businesses. Candidates identified by local response teams and JobLink centers will receive specialized training by 13 community colleges and, if they qualify, a business loan from the Rural Center’s Microenterprise Loan Program. To participate, an individual must have been laid off within the last three years and must reside in one of 28 counties. The N.C. Department of Commerce is providing $100,000 to initiate the program and the Rural Center is providing $1 million in micro loans.

In addition, the Rural Economic Development Center and state announced three other initiatives:

More information on the Institute for Rural Entrepreneurship is available at: http://www.ncruralcenter.org/entrepreneurship/index.asp

return to the top of this page

Maryland Supports For-Profit to Speed Tech Commercialization
With the support of Maryland's Department of Business and Economic Development (DBED), BrainChild Maryland was launched this week to identify and capitalize on Maryland's most promising new technologies. The for-profit company will identify university and federal lab technologies that have the greatest potential for becoming viable products and services. BrainChild Maryland will then help to transform these ideas into new spin-out companies and licensing deals.

Through its Challenge Investment Fund, DBED's Investment Financing Group is committed to investing up to $1 million over a four-year period in start-up capital in BrainChild Maryland. The company is raising an additional $1 million to 2 million from private investors. BrainChild Maryland also has formed a close partnership with the Maryland Technology Development Corporation (TEDCO), which is working to increase the number of invention disclosures and patent applications within Maryland's universities.

The business model for BrainChild Maryland is based much on companies such as Zircle, which is trying to get jumpstarted with technology from Sandia National Laboratories in New Mexico, and the U.K.-based TechTran Group created in 2002. In this model, independent, for-profit companies drive the technology commercialization effort through close, collaborative partnerships with research institutions and public agencies, as well as a strong commitment to economic development. Gov. Bill Richardson projected in May 2003 the Zircle-Sandia partnership would create 2,000 jobs in New Mexico within four years.

BrainChild Maryland will work to bring each technology to market by building and launching a new Maryland-based technology company with seasoned management, seed funding, strong advisors and a concrete commercialization plan. It will provide active, long-term mentoring and support to ensure that each company in its portfolio reaches its full business potential.

More information is available from Brainchild by contacting Jessica Tiller at 410-727-6855.

return to the top of this page

International Trademarking Easier With U.S. Treaty
The process of registering trademarks in multiple countries became simpler on Nov. 2 when an international treaty administered by the World Intellectual Property Organization (WIPO) entered into force in the U.S.

Under the treaty, American trademark owners who have an underlying registration or pending application at the United States Patent and Trademark Office (USPTO) may file an international application that designates one or more of the 60 countries that are members of the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks. Trademark owners in other member countries also will be able to file, directly with those national offices, international applications that include a designation of the U.S.

Previously, American applicants had to file separately in each of the national or regional offices of the member countries and intergovernmental organizations where they sought to protect their trademarks, and Madrid Protocol applicants had to file separately with the USPTO. The Madrid Protocol will now allow consolidation of many of those national filings, which is expected to result in efficiency gains and significant cost savings for trademark owners.

Because the U.S. maintains commerce with so many countries, this event is expected to initiate a new period of growth for the Madrid System Concerning the International Registration of Marks. The Madrid system is governed by the Madrid Agreement Concerning the International Registration of Marks, which dates from 1891, and the Madrid Protocol, which introduced several new features into the system with its arrival in 1996. A country may adhere to the Madrid Agreement, Madrid Protocol or both; intergovernmental organizations may adhere to the Madrid Protocol only. International registrations presently number about 400,000.

The Madrid System has experienced a relatively steady increase in membership since the adoption of the Madrid Protocol. On Dec. 25, the number of Madrid Protocol countries will reach 61, and the number of countries party to the Madrid Agreement will be 54. Other countries to join the Madrid Protocol in 2003 include the Republic of Korea, the Netherlands Antilles, Albania, Cyprus and the Islamic Republic of Iran. Croatia will join in January 2004, and the European Community also has taken political and legislative steps toward membership.

For more information on the Madrid Protocol, visit WIPO at: http://www.wipo.org/madrid/en/legal_texts/madrid_protocol.htm

return to the top of this page

Young, Single College Grads Still Mobile and Urban, Census Bureau Reports
Young, single, college-educated people are moving to large metropolitan areas, often to central cities — a trend that defies the general population’s outward migration from the same areas, according to a report based on Census 2000 data released by the U.S. Census Bureau today.

The New York, Chicago, Los Angeles and Washington-Baltimore metro areas remained popular magnets for young singles who had graduated from college, despite these areas’ overall net out-migration rates. Of the 20 largest metropolitan areas, San Francisco-Oakland-San Jose had the highest net migration gain of nearly 50,000 single college graduates in the 25- to 39-year-old range. Many favored other metropolitan destinations, including Las Vegas, Atlanta and Charlotte, N.C.

Migration of the Young, Single and College Educated: 1995 to 2000 states that three-fourths of these people changed residence during that period. Of those who lived in central cities in 2000, a ratio of 8-in-10 said they moved during the previous five years.

Some states, such as California and Illinois, saw net out-migration of the general population, but still attracted young, single college grads. Nevada, Georgia and other states that were powerhouses of domestic migration were also popular destinations for this demographic group.

Other highlights of the report:

The data are based on responses from the sample of households that received the census long form, about 1-in-6 nationally, and are subject to sampling and nonsampling error. Migration of the Young, Single and College Educated: 1995 to 2000 and other published migration reports are available at: http://www.census.gov/population/www/cen2000/migration.html

Useful Stats: Net Migration by State and Metro Area
Based on the Census report and accompanying data, SSTI has prepared two summary tables presenting net migration figures for the 1995-2000 for each state and for the 276 Metropolitan Statistical Areas in the U.S. For each table, the jurisdictions are ranked by numerical gain or loss in migration.

The state table is available at: http://www.ssti.org/Digest/Tables/110703t2.htm

The table of MSAs can be found at: http://www.ssti.org/Digest/Tables/110703t3.htm

The complete MSA data set can be obtained at no charge from the U.S. Census Bureau.

return to the top of this page

State Science & Technology Institute
5015 Pine Creek Drive
Westerville, OH  43081
Phone: (614) 901-1690
Fax: (614) 901-1696
Email: ssti@ssti.org

© 2003 State Science and Technology Institute. All rights reserved.